Oil Smuggling To Iran Embarrassment For Iraq

[Purveyor]

SULAIMANIYAH, Iraq (AP) -- The smuggling of tens of thousands of gallons a day of crude oil and refined fuels from northern Iraq to Iran, in violation of new U.S. sanctions, is stoking tensions between Iraq's central government and its Kurdish provincial counterparts.

The reports about the oil smuggling surfaced just over a week after the U.S. imposed new sanctions barring the export of refined fuels to Iran. They also arise at a time when Kurdish help may be needed to form the next government as politicians in Baghdad have been deadlocked since the March 7 election.

Iraqi officials quickly vowed to do something about the practice. The smuggling is an embarrassment for Baghdad and the Kurds - both U.S. allies - not only because of the sanctions but also because of Iraqis' perception that politicians are profiting on the trade while the public suffers from fuel shortages.

Iraqi Oil Minister Hussain al-Shahristani said Tuesday the cabinet had decided to summon representatives of the Kurdish regional government to discuss the smuggling issue and "to put an end to it, as it harms Iraq's national and economic interests."

"This matter is unacceptable and strange," al-Shahristani told reporters after the cabinet meeting. It is "illogical to export refined products to neighboring countries while Iraq imports refined products such as gasoline."

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